Markets Keeping Weary Eye on Corporate Earnings

10/24/2012 8:30AM

As corporate earnings come in lower than expected, the markets are fluctuating on the news; Zynga has closed its entire Boston office, and more layoffs could be coming; Romney and Obama have differing views on the size of the U.S. Navy. Photo: AP.

This transcript has been automatically generated and may not be 100% accurate.

... the the ... the ... stock market lately good morning welcome new sub I'm Ralf Winkler ... but today boules are hoping to regroup DowJones John Shipman is here to break it down John good morning good morning so ... I just wanted to be done in terms of corporates and even ... Google Caterpillar DuPont IBM Intel CMC ... McDonald's United Technologies three and it's it's been a just state ... of battery so yet in that mostly it's it's been a lack of revenue growth out of the key theme for all of these companies ... many of them have even you met expectations on the bottom line or even slightly exceed a little bit ... but ... investors can see that a lot of of ... of the reason for that is to the cost-cutting ... on its no other accounting measures that they can they can use to to ... bolster the bottom line but the key thing is if your sales are growing ... that dozens of ... indicate ... profits are going to really do have some good news for the market ... today ... Facebook overnight ... pedigree but wait for the data mean you're here we have yesterday's close and Dallas it was a bad day there were jumping into Facebook ... that is the outset now four dollars and thirty five cents yet hungry market ... he ... given because the mobile ... phone aspects of advertising has been a little bit more traction there will still doesn't talk about that market segment ... the second ... in the wiki thing to think of for them the broader market today is Boeing's earnings aam ... it basically came in ... a little bit better than expected ... the eye and with low balling ... it stands I will but for most of the big industrials and that the revenue actually grew thirteen percent ... vs year ago ... sold its shares were up last I checked were up about three percent premarket and so that she got about ... fifteen or sixteen points to the Dow ... meanwhile ... the euro had a big move ... overnight in Dallas ... some of ... the negative ... he says I'm not ... does that ring on my of nonmanufacturing there and so the diving for his ... platelets any rate now weren't were seated by that what looks to how big is the ... it's ... so old in the Nov up any would be a big move on ... for a ... euro US dollar for instance and so on yesterday was was Khona hovering in the ... mid one twenty nine and have sort of range it got up a little bit closer to one thirty ... I'm not sure what how high cut overnight but with the we saw a dip ... almost to the old one twenty nine flat level ... overnight and it since bounced up a little bit every day ... today we have a few things before to ... Facebook's can trade out ... we have a new home sales at ten am where we expect that will confer about a three nap percent increase in non September new home sales and so ... should that ... occur even be a little bit better though ... continue to feed into the the idea that the housing market is slowly recovering to be I mean what gets us back to ... if ... not I before e season started ... stock market was ... the lead back to Heidi had reached since the financial crisis ... and ... in and now we've we just we come way off of those who is there some days there is there another engine is is Ben Rene Kyi in the eyes of the limited on buying his own on going to ... what that what you saw what the stock market with stock market was rising heading into the the third quarter earnings period in anticipate low basically anticipation of of the Fed ... on ... you know ... the QE three aspect of Fed printing more ... money ... and so did the especially top that like ... everyone I think there was a was fairly common knowledge of the third quarter for the third-quarter earnings period is not can it be great ... and it's the reality of that situation has gotten heading home ... now of I think you're still gonna see this tug of war though between ... um what the Fed is doing and the fundamental situation for corporate it's okay ... and is speaking which I mean at what I did is that with the Fed does even ... translate into corporate earnings is is just getting to ... the ... increased the price of assets or does it actually counted ... E-mail getting to the denominator of all the weekend rally to drive up the TV to run dry the vehicle certain rest of the fence hoping that a lot of changes on the wealth effect so if ... if the Fed and other central banks can sustain these asset prices ... and and get people feeling better about the overall economy or their personal financial situation ... to get out spend money then behold the of the ideas that that would hopefully be ... ignite somehow to spark for the broader economy but it's gonna be awhile before ... most are in the study with a unit based on short ... and for more be sure to join us on the Markets other at ten thirty ... will be right back ... I think Governor Romney may be ... as a span of time looking at our military works you you mention the Navy for example ... we have ... fewer shots than we did in nineteen sixty ... we also have fewer forces and bayonets ... because ... the nature of our Meltzer is change we have these things called aircraft carriers were planes land although ... we have ... these chips to go underwater nuclear submarines ... Mitt Romney wants a much bigger Navy do we needed to pay for it at a chorus is what's being talked about after that quick to use on the debate ... meanwhile Brock Obama wants to do more with less ... let weaken our national defense to help answer this question Wall Street Journal's national security reporter Dion Nissenbaum joins us now dang good morning ... c'mon area ... um well I'm well so it ... is that horses bayonets lying ... in in in ... mid BBB comes from the Romney saying we haven't had ... we don't have is nice if the data or we've we've drawn down an eighty two point ... three suspected World War one this kind of underlines really ... a difference in ... a real difference in Tintin strategy between the two candidates ... and ... for so what was to Emma what was the president's policies and where is the U S Navy ... or email that the Navy's out about two hundred and eighty seven ships and ... if you actually do I look at the numbers that's actually a larger than ... it was ... I'm there the last president President Bush seven other numbers there ... are are a little fuzzy What to President Obama is looking to do ... is increase the number of ships over the next ten years to about three thirteen s what is what he'd like to do ... I'm the president has been focusing on ... this what they call this tidbit to Asia and Pacific as the wars in Afghanistan wind down ... I they wanna move ... the ships and rebalance the fleet which is now fifty fifty Atlantic Pacific and move it to a sixty forty split with sixty percent ... I in the Pacific ... what Governor Romney is saying is the look if you're gonna make that move then you need any more ships that ... Governor Romney's talking about three hundred and fifty ships building three hundred and fifty ships in increasing ... the number of ships to be built over the next few years now ... to to to be clear here ... there's also is a real difference in ... in in costs potentially ... sold ... under for Pres Obama besides that the changing table techies deals was to draw down ... troops ... and meanwhile Mitt Romney does one do that and wants to boost weeks ... Ginny but let let's let's folks on that case the paper that ... well that's and that's ... one of the big question is not certainly one of the big criticisms that you hear from ... the Obama campaign is that that ... Governor Romney wants to increase ship sizes he said that the president's plan talks about reducing ... the army and the Marines by about a hundred thousand forces ... Governor Romney says he wants to stop that from happening and then ... it began to build more ships he need more people to put on and say probably half that more people there ... um there are estimates that the governor's plan could add two trillion dollars to the Pentagon budget over ten years and ... ends Nino weren't a budgetary times everybody knows this well how do you pay for that and outside analysts say there there are three ways to do that either you cut ... other programs ... I'm you raise taxes or even increase the deficit ... now ... Governor Romney says that well they can they can make up a lot of this by ... the efficiencies of the Pentagon you try and ... reform the way that you buy the planes and ships and and reduced costs there ... you get rid of some of the civilian workforce ... it's grown exponentially ... and you try and deal with other other farms and load them but they see in the Pentagon ... there's a lot of people think that would be really difficult to do to get two trillion dollars over the next ten years so it's it's a numbers question Daniel also spends ... a lot of time in Afghanistan recently ... and I wanna ask you really how does your time there ... in Kyneton in May ... they talk about again ... really the the the difference in policy ... among the candidates ... he ... in Afghanistan as well and what the impact will be there ... bought it in the debate on Monday night you did hear of Governor Romney's say very firmly ... I've that he believes that ... the troops should leave in twenty fourteen ... I he he hasn't been as firm on on that deadline in the past ... I'd I think that both candidates are certain is leading towards ... a drawdown of the war and I think the interesting thing to watch going forward is ... what we do about negotiating what's called the status of forces agreement which would allow the United States to leave a certain number ... of troops in Afghanistan to deal with threats from Pakistan and try and deal with al Qaeda coming back and try and prevent the Taliban from ... regaining power there ... um you remember of course that to that the United States present Obama were able to get a status of forces agreement in Iraq which led to let the pullout ... and that was the source of friction in the debate on Monday night and I think we need to watch and see what they both wanted you or what the next president wants to do in terms of trying to negotiate ... the status of forces agreement and what that will really mean for the U S troop presence there going for it to it's it's a question I'd like to see address that there are actually that ... probably not for the campaign so ... we we all went thank you so much for joining us this morning ... more bad news for Zynga that's coming up ... Facebook reported that great quarter last night Zynga meanwhile said it will fire up two or maybe more than one hundred and shutter some games that are working ... fortunes diverge in social media Tom area is here to make sense of it on the morning ... so ... what what was the news we got a Z in and what they say specifically about ... what they're getting hit by the way actually should know for people that ... summer these bad news is it I think they released it ... during Apple'siPad minivan ... exactly of the new Friday afternoon of the social media community of a cartel singular mission on Friday afternoons to do that now dubbed an Apple event yet ... so so what what are they said ... well in the chairman of notebook they knew they didn't Fayyad when they didn't the Fed and how is off to the news or he laid on my knee and I went and bought a bunch of people ... the people wrote about online in Europe with a better things like that ... and then outline of a disembodied public pub publicize the nomination and inside the office that would likely set about five percent of the stock is doing right now ... um ... in a company that fundamentals may be between hundred to two hundred and seventy people from the credit if they do don't have a little ... fight the Fed the closing down offices and ... with the U S under the sea the sun setting on gains also that ... yet ... this is this is kind of a piece of the earnings that we got out of them which is ... published their old titles FarmVille CityVille ... I did I know that we did a shuttering nose know but but ... they're kind of ... gamers are losing interest in them ... yet but let me ... directly the company is literally kind of a collapse now ... Yeh and some of the stuff that was reported yesterday is the northern region from setting Dems haven't taken off the table for it ... it looks like drop a couple of turns in development of a tooth decided to ... make them in order to keep on investing in ... one of them are thinking unwarranted and the men launched a one thing it's interesting you sell a stock screener it isn't going down a lot to ... me one reason is that ... he did that crazy about two dollars and thirty cents company isn't ... valued much more than the cash they have a balance sheet ... doesn't cash they've got Neil their headquarters ... yet that up ... is probably ... a lot of knowing the regional bought Katie above ninety share something like that entry into thirty sell me on this it was almost as companies almost ... stick of the self worth zero ... yet exactly and I was one of the previous three more in your ... fridge and Trevor went on CNBC in the morning instead of the race between them and RadioShack defeated if the euro for the ... year when it didn't intend to accompany his biggest ... attribute of the novena is ones doing it from an uncommon on to what happened and why is it just ... the games just ... lost popularity disappeared its mobile it's everybody's going to mobile devices and ... and in in releasing it dominated ... the gaming on Facebook on desktop ... and ultimately offer from from the finger livid of industry on them and we just don't know why Norway's them of a Facebook IPO you're ... a much bigger company everything was great and then had the most ever undecided ... the other one is interested in and of coupon on Facebook of NAB's results today showing ... the doing quite well in the stock is offering a twenty five percent this morning in pre market trading offers its twenty four point seven when he was dead on screen he said that will not do it in a hot dinner but in Asia ... someone like you know for all of my take is for them to come out and say actually FarmVille two which it hasn't been released it wasn't hard for this quarter results ... know that just cannot demand ... may be from gorges and use whatever you thought this is the future again you know in a month's time when they realize that sleeping or if you ... make a good idea I mean ... the thing I'd personally I doubt it had added hadn't read about this a look at it a little bit just seems like ... that really is what happening EDD this is a company that came to dominate Facebook games ... thanks in large measure to sometimes aggressive marketing practices that begin in you're going ... to Facebook crackdown on ... and now ... expects to that that that's not there anymore and especially as people move to using Facebook on their mobile phones ... we are ... gaining its different experience than what witnessing a ... convincing is popular titles ... and ... its discontinued their hearts rather it is much more competitive ... on on your I phone to get discovered to get players on their ... the thought that if the Fed both want the car industry veteran right I mean it's basically ... a competing with every other viral thing with other news Mr. with these guys or ... the other thing that you wanna click on the funding ... to cover bit of magic and waterways in terms of what works what doesn't you just never really given no one to a dozen of the huge smash hit again ... they want to me maybe they wouldn't stop looking for this account from around fourteen in Oslo rather than just ... doesn't like to release of the predictable business cycle and it deftly does not take it on so much for joining us ... and thank you for joining us on the news of this morning I'm Ralf Winkler ...